A pericentric chromosome 16 inversion, inv(16)(p13;q22), is present in almost 100% of patients with the M4Eo subtype of acute myeloid leukemia. A fusion gene between CBFB, the gene for a subunit of transcription factor CBF/PEBP2, and MYH11, which codes for smooth muscle myosin heavy chain, is generated by this chromosome 16 inversion. This fusion gene is believed to play a key role in leukemogenesis. We recapitulated this fusion gene in mice by inserting a human MYH11 cDNA into mouse Cbfb gene by homologous recombination. Chimeric mice lacked contribution of ES cells with the fusion gene to hematopoietic tissues selectively, suggesting a toxic effect of the fusion gene to hematopoiesis. Embryos heterozygous for the fusion gene had defects in both primitive and definitive hematopoiesis and died in midgestation due to widespread CNS hemorrhages. The phenotype is suggestive of a mechanism by which the chimeric protein Cbfb-SMMHC, coded by the fusion gene Cbfb-MYH11, dominantly interferes with transcriptional regulation by CBF as well as one or more additional pathways important for hematopoiesis. The phenotype of hematopoiesis blockage is consistent with the potential of this fusion gene to contribute to leukemogenesis. We are designing experiments to understand the underlying mechanisms and to bypass the embryonic lethality in order to observe the effects of this fusion gene in adult mice. To understand how Cbfb-SMMHC interferes with transcriptional regulation by CBF and other proteins, we have started to analysis its effect on DNA binding by Cbfa and ETS, another transcription factor important for hematopoiesis. Bacterial and insect viral vectors have been constructed or obtained from our collaborator Nancy Speck for the expression of the proteins. Proteins have been purified and used in assays for DNA-protein bindings. Preliminary results indicate that Cbfb-SMMHC has some effect on the cooperative interaction between Cbf and Ets. Further studies are in progress to confirm this finding and to extend to in vivo assays for the detection of any functional differences.